Soaring gold prices boost value of Matheson deposit

Mayfair Gold is taking advantage of soaring gold prices to boost the quality and value of the mineral resource at its exploration project outside Matheson.

The Vancouver open-pit mine developer said in an update this week that higher gold prices have enabled them to increase the amount of indicated gold resources at its Fenn-Gib project.

Mayfair has done a slew of drilling there since acquiring the project from Pan American Silver in late 2020 and has outlined an area to site a possible open-pit operation, 20 kilometres east of Matheson.

A prefeasibility study is underway, which is an early stage analysis of a potential mine.

In a project update this week, Mayfair said the actual resource at Fenn-Gib remains mostly unchanged from a year ago — up one per cent – but high gold price allows them to lower their cut-off grade, which now stands at 0.3 grams per tonne.

A cut-off grade is the grade of that a deposit can be economically mined and dictates which drill intercepts can and can’t be used when compiling a mineral resource. The cut-off is determined by the cost to mine a deposit and the price of the commodity.

The company said its current indicated gold resource is a better reflection of today’s gold prices. The indicated resource now stands at 4.3 million ounces, up from 3.38 million ounces, based on a gold price of US$2,000 rather than the previous US$1,765.

An indicated resource means the quantity, grade or quality of an ore deposit is such that it supports a level of confidence that it can be mined. It’s on a higher scale than an inferred resource where there is less certainty.

In a statement, Mayfair's interim CEO, Darren McLean, said they envision various mining scenarios, ranging from small-scale, higher grade mining opportunities to lower grade, bulk tonne options.

The company has also started a metallurgical test program to better understand how to process the mined material.

Mayfair didn’t say in its release when the prefeasibility study will be complete but mentioned a feasibility study will start in 2025.

Fenn-Gib, Mayfair’s only asset, is located just off Highway 101 in the prolific Abitibi gold belt of northeastern Ontario.